Sustainable Palm Oil Still A Deadly Fraud?
Palm oil is the fastest-growing commodity on the planet. Sales are expected to exceed $88 billion by 2022. Unfortunately, the industry and its supporters are still blowing smoke about deforestation, biodiversity and climate change. There’s a better way forward and we can help make it a reality. Palm oil is one of the most controversial commodities. It’s driving deforestation on a massive scale across Southeast Asia, South America and Africa. Deforestation is a major contributor to global warming, land-use change and wildlife extinction.
Indonesia is the world’s largest producer of crude palm oil. Approximately 45 million acres of land in Indonesia has been licensed for palm oil development. Unfortunately, licenses mean very little in the land of smoke and mirrors. Even protected areas, such as the Leuser National Park, are under siege. The so-called Roundtable On Sustainable Palm Oil (RSPO) members aren’t defending biodiversity or the forests. They only protect themselves from the truth. Palm oil is derived from the fruit harvested from date palm trees. Presently, more than 95 percent of palm oil is produced in Indonesia and Malaysia. It is marketed as a low-cost form of vegetable oil. It’s used in the majority of consumer goods, including food and personal products, such as lotion and soaps. It’s also marketed as a biofuel. Multinational corporations, including Unilever, PepsiCo, Kellogg’s, Ferrero and many others are under fire from customers and stockholders for supporting deforestation. These companies and the palm oil industry have gone to great lengths for years to cover their tracks and green wash their supply chain with claims of so-called sustainable palm oil. There is no such thing as sustainable palm oil. It’s no more sustainable than crude oil or coal.
RSPO was set up in 2004 following a series of meetings between WWF and palm oil companies. According to WWF, “One of the huge successes of the Roundtable is the development of a certification system for sustainable palm oil.” Unfortunately, that certification system was riddled with fraud and abuse. It’s a label bought not earned. In 2015, a report by the Environmental Investigation Agency and Grassroots exposed serious problems in the RSPO certification system. Auditing firms that are supposed to monitor palm oil companies’ operations are colluding with the companies to hide violations. The latest trend is called Certified Sustainable Palm Oil (CSPO). Call it what you will—palm oil plantations and biodiversity do not mix. Animals that enter palm oil plantations are killed. In many cases, bounties have been put on endangered orangutans, elephants and Sumatran tigers. Indonesia has already pushed two tiger species into extinction. The Sumatran tiger could easily follow the Java tiger and Bali tiger into the history books thanks to an industry with no reverence or conscience. In 2013, Greenpeace produced a report titled “Certifying Destruction,” which highlighted some of the tactics being used to shield the truth about this massive industry. A similar report came out again in 2015 by EIA. In a similar vein, PepsiCo recently released a report in an attempt to cover its tracks. Rainforest Action Network pounced on the report this week as another attempt to cover up the blood in its supply chain. A report released by Rainforest Action Network (RAN) in April 2017, titled “Profits over People and the Planet, Not ‘Performance with Purpose’; Exposing PepsiCo’s Real Agenda,” revealed PepsiCo’s connections to Conflict Palm Oil suppliers, which are driving deforestation, climate emissions, and human and labor rights abuses across Indonesia, Malaysia, and Latin America. Today’s release by PepsiCo lacks a meaningful response to the issues raised in RAN’s report.
“PepsiCo’s latest “Palm Oil Action Plan Progress Report” is a masterful attempt to window dress its lack of progress in addressing the systemic environmental and human rights violations in its palm oil supply chain and in the operations of its joint venture partner Indofood. In the real world, forests continue to fall and workers continue to be exploited for the production of palm oil used in PepsiCo’s products.
“While PepsiCo openly acknowledges in its report that deforestation and labor rights violations are rampant in the palm oil industry, the company has once again failed to set a deadline to end these abuses in its own supply chains,” said Robin Averbeck, Senior Campaigner of RAN. “Instead, PepsiCo hides behind false claims of sustainability made by the RSPO––the same certification system that has continued to certify its controversial partner Indofood, despite its ongoing exploitation of workers exposed by RAN, Indonesian labor rights organization OPPUK, and International Labor Rights Forum in June 2016.” “PepsiCo needs to stop the corporate green wash and start enforcing an end to rainforest destruction and the violation of workers and communities’ rights in its supply chain and the plantations controlled by its partner Indofood. Until it does so, PepsiCo and its financial backers will be exposed to campaigns that demand real outcomes on the ground.”
The palm oil industry and its pimps throughout the supply chain, including the RSPO, continue throwing misinformation into the market to placate investors, wholesale buyers and consumers of products that contain palm oil.
Meanwhile, RSPO members continue to rape and pillage virgin rainforests and peat lands as they produce more than half of global palm oil supplies.
European nations are threatening to ban palm oil as a renewable biofuel in an attempt to reduce demand and force meaningful changes in the palm oil industry. Indonesia and Malaysia are digging in to keep palm oil production and consumption at an all-time high. The industry accounts for billions of dollars per year for the countries’ tycoons and cronies.
As all of this fraud indicates, the palm oil producers and buyers are desperately seeking solutions, while deforestation and its contribution to wildlife extinction continue. According to a report from the World Economic Forum, the push to get commodity producers, including beef and soy, out of the world’s last rain forests represents a multi-billion dollar opportunity. The good news is that an alternative production model exists that isn’t dependent on rain forest destruction. Cities around the world in the tropics, subtropics and deserts represent a powerful opportunity to expand the footprint of palm oil production, while promoting urban agroforestry, sustainability, resiliency and economic development. It can also cut shipping costs by decentralizing the production so that it’s closer to the buyers, such as PepsiCo and others. It’s a win-win opportunity for all stakeholders and stockholders. We need a leader to step forward to demonstrate the benefits of urban agroforestry. It’s a deforestation-free production model that offers valuable benefits. This initiative will make cities more productive, livable, sustainable and resilient. Some of the new palm trees can help combat the urban heat island effect on our streets and highways. Others can reduce energy demands by sheltering homes, schools and office buildings. Strategically placed trees also can shade parks, golf courses, parks, school grounds and rooftops, while absorbing and sequestering tons of carbon dioxide. Farms and ranches will have an incentive to line their fence lines with a new cash crop. Most importantly, we can create jobs, educational opportunities and sustainable palm oil worth millions of dollars every year just by being resourceful and innovative.
RSPO Background & Update (November 2020):
The Roundtable on Sustainable Palm Oil (RSPO) is an industry body formed in 2004 with a mission to reassure consumers that palm oil bearing its certificate of approval is free from links with primary forest destruction, damage to endangered species’ habitats or abuses of the rights of indigenous peoples and communities. As you can see, just from the following links, complaints and commentary, the RSPO is severely lacking after 16 years of blowing smoke
Certified ‘sustainable’ palm oil plantations endanger mammal habitats and biodiverse tropical forests over 30 years. https://phys.org/news/2020-07-certified-sustainable-palm-oil-fields.html
Earth.org supports sustainable palm oil in concept. Not there, yet. https://earth.org/how-palm-oil-contributes-to-environmental-destruction/
Environmental Investigation Agency: Who’s watching the Watchmen (2019) https://eia-international.org/news/palm-oil-watchdogs-sustainability-guarantee-is-still-a-destructive-con/
Environmental Investigation Agency: Who’s watching the Watchmen (2015): https://eia-international.org/report/who-watches-the-watchmen/
Mongabay Perspective (2020) https://news.mongabay.com/2020/08/palm-oil-certification-sustainable-rspo-deforestation-habitat-study/ RSPO meaningless
Palm Oil and Biodiversity (2018) https://www.theguardian.com/environment/2018/jun/26/palm-oil-disastrous-for-wildlife-but-here-to-stay-experts-warn
As you will see, in 2015, the Environmental Investigation Agency (EIA) and Grassroots released the report Who Watches the Watchmen? It revealed reckless management, extensive fraud as well as sub-standard and underhand assurance processes within the RSPO. The RSPO is often hailed as the best certification scheme for palm oil based on its standard – the Principles and Criteria (P&C). However, it receives far less scrutiny as to how it is ensuring its standards are adhered to and, therefore, its impact. Four years on from that report, the RSPO is about to start implementing its new and improved P&C – and we return to the scene of the crime to assess what, if anything, has changed and how the RSPO has responded to the serious concerns raised in 2015. Investigations have found that the action taken by the RSPO is severely lacking. Despite it setting up an Assurance Task Force, this body has failed to deliver and complete its objectives. The Assurance Task Force stands as one of the worst-run working groups of the RSPO. It has been disorganized, unprofessionally managed, and has chronically missed deadlines. The last update from the Assurance Task Force in 2018 reported 55 per cent of the activities were incomplete. Of the five key objectives under the Task Force, only the development of Free, Prior and Informed Consent guidelines has been completed, but their effectiveness is unknown. For the other four objectives, the actions and outputs under each of them has not led to the fulfillment of the objectives. Many of the same issues remain, have recurred and could easily occur again.
Non-adherence to the RSPO’s standards is systemic and widespread, and has led to ongoing land conflicts, labor abuses and destruction of forests. As the world approaches 2020 targets to halt deforestation, the RSPO needs to rapidly implement radical solutions to restore its credibility. We question whether the RSPO is willing and able to rectify its systemic failures – ultimately, voluntary certification is too limited by its voluntary nature.
The Watchmen report identified:
- Auditors providing fraudulent assessments that cover up violations of the RSPO Standard and procedures;
- Auditors failing to identify indigenous land right claims;
- Auditors failing to identify social conflicts arising due to abuse of community rights;
- Auditors failing to identify serious labor abuses;
- Auditors failing to identify risks of trafficked labor being used in plantations;
- Ambiguity over legal compliance;
- Auditors providing methodologically and substantively flawed High Conservation Value (HCV) area assessments that will enable destruction of HCVs;
- Certification bodies displaying weak understanding of the P&C standard;
- Certification bodies providing suspect assessments in response to legitimate complaints from NGOs, which fail to address the substance of the complaints;
- Conflicts of interest due to links between certification bodies and plantation companies.
Following the publication of the Watchmen report, a Resolution on ‘Ensuring quality, oversight and credibility of RSPO assessments’ which compelled the RSPO to act on the concerns raised was adopted in 2015 by RSPO members. The RSPO formed the Assurance Task Force (ATF) in 2016. (Better late than never.)
Four years later, significant concerns about the RSPO’s assurance systems still remain. More widely the credibility and impact of third-party certification schemes is in doubt. The New York Declaration on Forests concluded in September 2019 that deforestation has accelerated not diminished, despite certification schemes.
In 2018, the RSPO adopted a new and improved Principles and Criteria (P&C) that includes provisions for ensuring no deforestation, no new planting on peat, the protection of human rights defenders, improved workers’ rights and better smallholder inclusion. All audits undertaken from November 2019 will be assessed for compliance with this new P&C 2018. In 2019, the RSPO also announced it would establish a permanent Assurance Standing Committee (ASC). These developments are a natural point at which to take stock and undertake an analysis of the performance of the RSPO’s systems to-date.
With that powerful admission firmly on the table, what did RSPO stand for prior to 2019? The producers and buyers throughout the supply chain were clearly duped. That or they were complicit in one of the most destructive green-washing schemes in history.
The Watchmen report raised a number of concerns around the RSPO’s complaints system including that it failed to properly address the complicity of auditors in non-compliances which led to complaints, that certification bodies were allowed to assess complaints for companies they had certified – a clear conflict of interest – and measures were not taken against auditors even when the culpability of auditors was established in the complaints.
One of the key shortcomings highlighted was RSPO’s inability to detect violations before considerable harm had occurred and its unwillingness to contemplate a system which proactively identifies violation through the its own processes.
As of October 2019, there were 38 open complaints in the RSPO system. The longest has been open nine and a half years. About one third have been open more for than three years. On average, it takes 700 days before complaints are closed. According to the RSPO, the most frequent complaints are on Free, Prior and Informed Consent (FPIC), HCV areas and certification bodies – the very same issues documented in the Watchmen report.
The failures raised back in both 2013 and 2015 still remain institutionalized. Many NGOs have raised continuing concerns about the RSPO’s complaints – Profundo provides
recent examples of such concerns, as do the case studies in this report. RSPO members quitting the RSPO rather than resolving complaints remains a problem and seems to prevent the RSPO from sanctioning members over complaints to minimize its risk of losing members. The RSPO adopted a resolution in 2018 to try and discourage members with unresolved complaints from avoiding their obligations by divesting or membership withdrawal. It is yet to be seen how well this can be implemented.
According to the Forest People:
The Roundtable on Sustainable Palm Oil (RSPO) accepted a complaint against Golden Agri-Resources (GAR), alleging numerous violations of Indonesian law and RSPO standards. Based on state-of-the-art GIS and satellite imagery, the complaint alleges that GAR is illegally operating oil palm plantations inside Indonesia’s protected Forest Zone. The complaint, lodged by Forest Peoples Programme and Elk Hills Research, cites recent bribery convictions of multiple GAR officials in Central Kalimantan as evidence that the company was both aware of these land-use violations and corruptly tried to cover its tracks. According to the complaint, over 75,000 hectares of GAR’s land appear to be being used for unlawful oil palm production, representing over 15% of GAR’s total plantation area.
FPP and Elk Hills Research have called on RSPO to investigate these serious violations of RSPO standards and to suspend the sustainability certificates of GAR’s operations.
“RSPO knew about this bribery case when it was first reported but took no action. The RSPO Complaints Panel has also delayed for years taking action on the numerous other human rights violations and land disputes by GAR that we have exposed in previous complaints but which remain unresolved” says Marcus Colchester, FPP’s Senior Policy Advisor.
“The RSPO is meant to ensure accountability but instead allows impunity. This must end,” said Colchester.
“For too long, Golden Agri has benefited financially from unsustainable and unethical practices, while using its RSPO membership to represent to investors and customers that it behaves sustainably and ethically,” said Brennan Bilberry, co-founder of Elk Hills Research. “The serious evidence of deforestation, bribery, and general lawlessness we have uncovered warrant quick action by the RSPO, so it can put an end to what appears to be GAR’s systemic misconduct. It is time for multinational consumer goods companies to make good on their sustainability commitments by re-examining their relationship with companies that contribute to deforestation and corruption.”
US investors interested in environmental, social, and governance (ESG) objectives funded the work by Elk Hills Research, which contributed to this complaint—the first of its magnitude.
“It’s time for investors who are serious about ESG to move from mere passive avoidance to more active engagement, either by demanding that problematic companies change their practices or, if necessary, by exposing flagrant violations of environmental and good-governance laws. By working to uncover wrongdoing like that alleged in our complaint, investors can ensure that the worst offenders suffer real consequences, which may be key to preventing corporate wrongdoing,” said Jamie Crooks, co-founder of Elk Hills Research.
Thanks to Forest People! I applaud your work.
With that said, the question remains, what does RSPO stand for today? In a complaint filed in 2020 by Forest People, it claims that RSPO is complicit in bribery schemes, cover-ups and overall mismanagement. So, why should the world believe them after 16 years of crimes against nature and humanity?
One of the founders of the group is Paul Polman, the former CEO of Unilever. He has just been tapped to head a global effort against green washing. Please ask him to drain the swamp at RSPO. The group must be part of the solution. It can’t continue to help coverup the problem. Meanwhile, ask yourself if you really need Nutella, Girl Scout Cookies and other junk foods that are responsible for destroying vital ecosystems. Ask yourself if a biofuel is really a good thing if the “bio” means rainforest destruction. There is a better path forward than wholesale destruction and fraud. Mr. Polman, answers begin with the truth. I’m here to help.